Saudi Arabia and 9/11: Establishing the Truth Behind the Release of the 28 Pages and the “Justice Against Sponsors of Terrorism Act” By Anthony H. Cordesman Update: September 14, 2016 Please provide comments to [email protected] Cover: DoD photo by Master Sgt. Ben Bloker, U.S. Air Force Saudi Arabia and the Justice Against Sponsors of Terrorism Attack 14/9/16 2 Saudi Arabia and the Justice Against Sponsors of Terrorism Act President Obama has made it clear that he intends to veto the legislation the House passed on September 9, 2016 that would allow families of those killed in the Sept. 11, 2001, attacks to sue Saudi Arabia for any role its officials played in the terrorist attack. He should veto the bill and the Congress should pause and not override that veto. It is all too easy to understand anger the families and survivors of those who were victims on 9/11 feel, and the desire they have to find someone to punish and blame and for some compensation for their losses. It is equally easy to understand the mixed motives of a Congress caught up in the politics of tenth anniversary of the attack, an election year, and the desire not to seem soft on terrorism. Saudi Arabia is also one of America’s most difficult strategic partners for Americans to understand, and its progress, reforms, and strategic importance are often badly understated. It is easier to focus on the fact it is an Islamic state at a time when extremist threats like ISIS, Al Qaida, and the Taliban, than deal with the complicated security issues in the Gulf region and the fact the U.S. is critically dependent on /Saudi Arabia both in dealing with Iran and in fight terrorism in the region from which it draws most of its strength. This may help explain why the Congress passed a bill based so loosely on some 28 pages in a report that does not find the Saudi government to be guilty of anything, ignored the extent to which the legislation raised major issues international law and potentially opened the U.S up to suits again America, and did so without ever debating the bill on the floor of the Senate – which originally passed the bill in May, and in the House which passed it on September 9th. It is also why the Congress is also considering blocking major arms transfers to Saudi Arabia at the U.S. had already made Saudi Arabia both the key regional military power and key U.S. strategic partner in the Gulf by selling it over $152 billion worth of advanced U.S. arms between 2001 and 2015. There may well be a good reason for the Congress and the Administration to publically reexamine U.S. strategy in the Gulf and the Middle East. The strategic value of the region is changing. The nuclear agreement with Iran has not moderated the threat it poses in the Gulf; its growing missile forces pose to the entire region, or the growth of its military influence in Iraq, Syria, Lebanon, Yemen and the region. The “war” against ISIS may win some important victories in Iraq and Syria, but it is all too clear that the threat posed by violent Islamic extremism and terrorism will continue and grow in spite of such victories. We need clearer strategies, we need more transparency, we need clear plans to deal with our strategic partners, and we need a bipartisan consensus our regional allies can trust. These efforts cannot, however, based on empty conspiracy theories, domestic political posturing, and a failure to honestly establish the facts. They cannot be based on making the worst-case interpretation of the suspicions set forth in 28 pages of redacted Congressional reporting provided in the Congressional Joint Inquiry into Intelligence Saudi Arabia and the Justice Against Sponsors of Terrorism Attack 14/9/16 3 Activities Before and After the Terrorist Attacks of September 11, 2001 – a report issued in December 2002 with only limited staff resources and long before the full facts were available. • The growing dependence of the global and U.S. economies on the stable flow of petroleum exports from the Gulf, their impact on key U.S. trading partner in Asia, and their impact on the U.S. economy in spite of the steady reductions in direct U.S. petroleum imports. • The full historical record of what happen in 9/11 and the fact that later FBI and U.S. intelligence investigations never found any meaningful Saudi official participation in 9/11. • The emergence of Saudi Arabia and other Arab allies as key partners in the broader struggle against terrorism and Islamic extremism. • The role Saudi Arabia plays in leading the Gulf Cooperation Council and regional security effort in the Gulf and the Muddle East, and in deterring and countering Iran. This scarcely means that the U.S. should not encourage reform in Saudi Arabia – reforms which its government has already begun to undertake. It does not mean the U.S. should not ask Saudi Arabia and its other regional allies to do more to fight violent extremism and provide for their own defense where this is possible. The last thing on earth the U.S. needs, however, is to “fight” terrorism by alienating a key partner in that fight as well as the equally important effort to contain and deter Iran. The Growing Dependence of the Global and U.S. Economies on the Stable Flow of Petroleum Exports From the Gulf The U.S. does need to take a much harder look at its overall strategic commitments in the Gulf. It needs to realistically assess the limits to the nuclear agreement with Iran, Iran’s efforts to build-up a major missile forces with conventional precision strike capabilities, to create an asymmetric naval-missile-air threat to Gulf shipping, and win influence over state and non-state actors and an axis that extends from its border with Afghanistan and Pakistan through Iraq, Syria, and Lebanon. Iran is no longer just a threat to the Gulf. It is a potential threat to every major U.S. ally in the region – Arab, Israel, and possibly even Turkey. America’s strategic interests are also no longer shaped by direct dependence on petroleum imports to the U.S. The U.S.is still a long way from total energy independence in the sense it no longer needs any petroleum imports, but it is indirect dependence on Gulf oil exports that now dominate U.S. strategic interests. OPEC estimates that Gulf nations exported some 16.8 million barrels of crude oil per day and 3.9 million barrels a day of product in 2014, and Iraq, Iraq, and Saudi Arabia all increased their exports of crude and product crude significantly in 2015 and 2016. They now account for over 43 % of world crude oil exports and 15% of world product exports. They feed the global economy with some 21 million barrels a day of crude and product, and the U.S. Energy Information Administration (EIA) reports that more than 17 million Saudi Arabia and the Justice Against Sponsors of Terrorism Attack 14/9/16 4 barrels a day of that flow must got through the shipping channels in the Gulf and pass through the narrow Strait of Hormuz at the southeastern end of the Gulf. The entire global economy is dependent on the security of that flow of exports, and the U.S. is becoming steady more dependent on the global economy. This dependence –not direct U.S imports of petroleum –is the key measure of U.S. strategic interest in the Gulf region. Having the flow of such exports guarded by U.S. forces –and by U.S. strategic partners like Saudi Arabia –is a vital U.S. strategic interest. It affects the growth and stability of every aspect of the U.S. economy and U.S. employment levels as well. Even if one only looks at U.S. trade, the CIA reports that the U.S. now has an economy with an annual GDP of $17.95 trillion. U.S. exports make up $1.6 trillion of that total – equal to 9% of the GDP. U.S. imports make up some $2.3 trillion, – equal to 13% of the GDP and including critical components of both U.S. consumer demand and high technology parts and supplies. The EIA estimates that the share of total U.S. petroleum and other liquids met by net imports fell from 60% in 2005 to an average of 32% in 2013. EIA expected the net import share to decline to 21% in 2015, which would have been be the lowest level since 1968, but lower oil prices have increases U.S. petroleum imports. The 2016 total seems somewhere close to 6.8% of U.S. imports vs. 8.2% in 2008. This compares with some 87% of U.S. imports that are manufactured goods and industrial supplies. This is scarcely zero petroleum dependence but it scarcely compares with U.S. dependence on key trading partners that are absolutely dependent on the flow of petroleum out of the Gulf. If one uses U.S, Census Bureau trade figures -- and only looks at the four largest U.S. Asian trading partners that are most dependent on Gulf petroleum exports -- China alone accounted for 21.5% of U.S. imports in 2015. Japan accounted for 5.8%. South Korea accounted for 3.2%, and Taiwan accounted for 1.8%. This is a total of 32.3% or roughly one-third of all U.S.